SEPA as driver for payment and e-invoicing improvements

(original interview from www.FDE.com)

The processes that dictate cash flow are moving online as e-invoicing and e-payment become more common, but in the payments space there is much to be done as companies move towards SEPA compliance. Now is the time to act, says Tonnis de Boer of payments consultancy Innopay, and independent advice could make all the difference.

The use of e-payment and e-invoicing among corporates is growing, but there is still a long way to go before they become the standard procedures for managing cash flows. E-invoicing offers obvious benefits in terms of efficiency when billing customers, but the real challenge is on the payments side, where changes will soon be required if companies are to be compliant with SEPA regulations.

Many companies have yet to see SEPA as a way to improve payment efficiency and lower transaction costs. There is no penalty for non-compliance at present, but that time will come, so corporates would do well to address SEPA now.

"SEPA has not really happened yet," remarks Tonnis de Boer of payments consultancy Innopay. "So far, it is mainly between banks, but everyone will have to move to it.

"Corporates will have to adapt their systems and processes. Some have ignored it or left the problem to their banks, so there is still a lot of work to do. Corporates must assess the impact of SEPA, even if it is only to verify that it might not impact them.

"Accounts payable and accounts receivable teams must look at e-invoicing and e-payment in an integrated way," he adds. "Corporates must act sooner rather than later. Being proactive is much better than being reactive."

Four reasons to act

"We can help companies to define their requirements and map them to the capabilities of the market to choose and use the right service provider."
Based in the Netherlands, Innopay is an independent consulting firm that specialises in payments and related transaction services. It focuses on helping clients to optimise their processes for online payment, e-invoicing, e-identity management and mobile payments.

So far, e-invoicing has gained some traction, mostly among large companies, but still only accounts for 7-10% of total invoicing volume, mainly because SMEs have not engaged with it. Movement in payment processes has been slower still.

"Accounts payable, accounts receivable, invoicing and payments - companies must assess their processes and define their requirements in those four areas, and not just for compliance purposes," says de Boer. "They can look at the total cost of collection and optimise payments while not losing out on potential efficiencies in e-invoicing. Service providers have developed a wide array of new services. Companies must define their needs in terms that service providers understand, so they can find a provider that can optimise both billing and payments."

An objective perspective

Many payments solutions come with free consultancy services, but from providers linked to financial institutions - providers that therefore have a vested interest in pushing for a particular solution, even if none is needed. But paying for an independent assessment may add more value in the long run. Innopay's independence means that it focuses on customers' requirements and matches them to the most appropriate solution in the market.

"We can help companies to define their requirements and map them to the capabilities of the market to choose and use the right service provider," says de Boer. "We can look at all four issues in an integrated way. We are experts in billing and payments. These are not side issues to us, as they would be to a large consultancy. We are independent from financial institutions, so we are not part of any one solution and we can help to find the solution that best meets our clients' needs.

"Any solution must be chosen for the long term," he continues. "It affects cash flow, so it is like open heart surgery for a company, but it is also a unique opportunity. Make a mistake now and you will suffer for the next decade. We are on the side of our client and we help them to get the best solution, whatever it may be."

Tonnis de Boer

www.innopay.com